Latest Posts

rss

Trading ‘Tilt’

  
  Education
#  #  #  #  #  #  #  #  #  #  #

A few of the many lessons to be learned from this story:

The market is always right–except at significant tops and significant bottoms.

Keep and open and flexible mind. When in doubt, get out.

If you must have a guru, take him or her with many grains of salt

Do not add to losing positions.

Try every day to make yourself stronger, better and more integrated as a person.

Stay true to yourself. Lying to yourself and others, and trading on hope and prayer do not work

Most importantly, accept and recognize that you are not perfect. You are human and are going to make mistakes. Trading is the only profession where losing is actually winning. BUT— unless you accept mistakes as mistakes and learn from them, you will not progress and be upside down. Unless you are able to get your trading brain out of the cave you will not accumulate regret. It is only through the true acceptance of a mistake as a mistake that we accumulate regret. This is how we learn and grow as traders and human beings.

The Dollar Surge is a Sign of Emerging Market Troubles.

  
  Education
#  #  #  #  #  #  #  #

A strong dollar doesn’t worry me, but a dollar that is THIS strong is a sign that something worrisome could be going on. Historically, substantial year over year increases in the dollar have been consistent with a flight to safety. With the recent European and Emerging Market turmoil we’re seeing huge demand for dollars as a good deal of foreign debt is dollar denominated.  The current surge in the dollar is a sign that there’s a flight to safety occurring and more turmoil in the financial markets than many might presume.

bear3

7 concepts that can make you a better trader

  
  Education
#  #  #  #  #  #  #  #  #  #  #  #  #  #  #  #  #  #  #  #
  • Momentum : If you understand this you will understand trends and mean reversion. You will understand why and how momentum works in the market. Most indicators are momentum based. Trend following and buying strength also works, so does mean reversion. They are all part of the momentum phenomenon. 
  • Market Breadth: Stock markets are composite markets. The overall move in market is an aggregate of moves of several hundred or several thousand stocks. So the level of participation in a move is important. 
  • Equity Selection: Because the overall market is a composite of many individual moves, it becomes critical to select right kind of stocks from the universe of stocks. Hence equity selection is extremely critical. You should know various ways in which one can select equities.
  • Market Anomalies: Market anomalies are the distortions in the market. If you base your trading on a proven and statistically significant anomaly, you will be profitable. Absent that no amount of indicators will help you. A through understanding of anomalies will give you an edge.
  • Market Microstructure: Market Microstructure is a branch of finance concerned with the details of how exchange occurs in markets.  Understanding this will tell you how the market operates. The concept of market microstructre is very critical if you are trading very small time frames or are a day trader. Because to be successful on those time frame you need to find exploitable anomalies in market microstructure. You need to understand role played by market makers, automated programs, arbitragers, large fund buyers and so on. Their tactics and behaviour creates certain patterns 
  • Growth investing : Growth investors buy stocks of companies growing faster than the average company in the market. 
  • Value investing : Value investors buy stocks of companies which are cheap or out of favor.

Game Theory And The Markets

  
  Education
#  #  #  #  #  #

game theoryWhen you take a position in the market, you are really playing a game against the market. Profitability doesn’t lie in your actions alone, it lies in the interaction between your position and the market’s price fluctuations…The goal of the individual is obvious. It is to make money. But what is the goal of the market? Simply put, the market wants you to lose money. This may be a provocative thought, but it is quite reasonable in the context of game theory.

Consistency

  
  Education
  Tags

consistency
Consistency, consistency, this is one of the most important quality I wanna achieve. Here I have a set of goals pertaining to consistency. I got the material from an article sometimes ago. I have no idea who is the author. Anyway, here is the abstract and I have added my own ideas.
I want to consistently..

  • Visualize myself in tune with the market
  • consistency1
  • consistency2

Meet the market with an empty mind

  
  Education
#  #  #  #  #  #  #  #  #  #  #  #  #  #  #  #  #  #

empty_mindYou know you are a daytrader when you go to the movies with loved ones and a line in the movie becomes you next daytrading blog post.

The movie was 2012. A movie about the end of the world and the preservation of the human race. the entire movie is filled with moments of natural disasters, crashing buildings, people meeting their end, and people who are trying to survive and perserve the human race.

Amongst the mass destruction where the south pole becomes located someplace in Wisconsin, it is not surprising that religion comes into play. Once scene includes a wise old monk speaking with a young monk who obviously has not attained the wisdom of the old man. As they are speaking the wise old man pours a cup of brown tea until it is overflowing. The young monk tells him to stop as the cup is overflowing. The old man stops pouring and explains,

 ”like this cup a man’s mind is overflowing with opinions and speculation.

You must empty  the cup in order to fill it with wisdom” (more…)

Go to top